Migros is opening 140 new branches

A lot has been reported about Migros this year, and the headlines have often been negative. The retailer is in the biggest crisis in its history – among other things, it is struggling with an outdated branch network, a complicated and confusing corporate structure and the ever-growing discounters. And so in recent months there have been sales of specialist stores and subsidiaries and also layoffs.

But now Migros is launching a public liberation strike. The press conference took place on Monday in the Migros branch on Limmatplatz in Zurich. Between vegetables and baked goods, the company’s management explained how things should continue in their core business, the supermarkets.

In the next five years, Migros wants to open 140 branches and invest two billion francs. The new stores will primarily be smaller supermarkets in areas where the population is growing rapidly. So cities. The aim is to become the nearest supermarket for 200,000 more households.

The announcement is a departure from the previous concept, in which Migros also relied on large branches in urban centers. However, because weekly shopping is becoming less popular and many people shop more frequently from day to day, smaller locations have become more important in recent years. By 2030, the branch network is expected to grow from 790 locations today to 930 locations. For comparison: The competitor Coop currently operates 965 branches.

Something is also happening at the existing supermarkets. 350 locations are to be modernized over the next five years. That corresponds to almost half of all stores.

Cheaper prices, more own brands

The group also adjusts its prices to those of discounters. This year and next, more than a thousand products are expected to become cheaper, including meat, fish and bread. This week we start with more than sixty products in the vegetables and fruits category. The reduced prices can be recognized by yellow signs.

“There is definitely no reason to go to the discounter anymore,” said Peter Diethelm, managing director of Supermarket AG. According to Diethelm, the new low prices affect all lines: from M-Budget to the standard products to the organic range. Migros will invest 500 million francs in price reductions over the next five years.

In recent years, Migros has increasingly added branded products to its range. The new strategy will now partially reverse this. The proportion of own brands is to be increased from around 78 percent today to 80 percent of the entire range. This gives them greater weight and a more prominent place in the branches. Migros boss Mario Irminger had previously made it clear that the company’s own industry should focus more on the needs of supermarkets and primarily produce cheap products for them.

With the investments of 2.5 billion francs communicated on Monday, the group profit will be lower than previously assumed, said Irminger. He did not give a specific number. At a meeting in September he promised a profit of 790 million francs.

Important but difficult business

So far, the restructuring at Migros has taken place mainly in the background, but also in the form of sales of specialist stores such as SportX or Melectronics. With the latest measures, Migros now also wants to make progress in its core business, supermarkets. Migros made the decision to run the supermarket business in a centrally controlled company in 2023. Supermarket AG officially launched in January.

The supermarkets are Migros’ most important but also the most sensitive business. The branches are divided into ten regions, whose cooperatives had previously maintained their own store concept. The shops in Ticino had different refrigerated units than those in eastern Switzerland or Basel. Another popular example is the Black Forest cake: there were different recipes for it depending on the region. Once it was the cherry on the cake, then again in between. This led, among other things, to high costs in industry and procurement.

Migros now wants to do away with such peculiarities. Starting next year, the branches will have a uniform appearance. In addition to procurement in the background, this also includes the visual appearance of the branches and the product range. Apart from products from the region, there will only be a national range in the future.